It is now accepted that Multiple Sclerosis (MS) is not just an inflammatory demyelinating but also a degenerative disease of the central nervous system (CNS) with early axonal transection, followed by neuronal loss as the disease progresses. Clinical, pathological and imaging studies suggest that in secondary progressive MS, inflammation and neuronal degeneration may be de-coupled with independent underlying processes. While immunomodulatory drugs control relapses in the relapsing phase of MS, secondary progressive MS is generally unresponsive to such treatment. Therefore, neuroprotective strategies are needed as the disease advances. Brain derived neurotrophic factor (BDNF) is a member of the neurotrophins family that supports neuronal and axonal survival. It has been demonstrated that BDNF is expressed in inflammatory brain lesions of MS and its expression is observed in infiltrating cells, especially T cells, B cells, and macrophages, as well as in neurons and astrocytes. During relapse, BDNF production by PBMCs is increased together with increase in production of proinflammatory cytokines. In EAE, BDNF-production is elevated before recovery. These studies suggested that the infiltrated cells exhibit dual function, tissue damage and tissue repair. Proinflammatory cytokines produced by infiltrated cells cause tissue damage, in contrast anti-inflammatory cytokines and neurotrophic factors produced by the infiltrated cells facilitate tissue repair. Therefore, disease course could be determined by the net effect of cytokines and neurotrophic factors produced by the infiltrated cells. Since immune infiltration is reduced in chronic disease (neurodegenerative stage), production of neurotrophic factors could subsequently be reduced. Thus, delivery of neurotrophic factors into the CNS lesions could be beneficial in the chronic phase of MS and EAE. It has been demonstrated that transplantation of bone marrow stem cells (BMSCs) can ameliorate the development of experimental autoimmune encephalomyelitis (EAE). This therapeutic effect is due to the immunosuppressive activity of BMSCs. BMSCs can induce tolerance in pathogenic T cells by suppressing production of proinflammatory cytokines and/or promoting differentiation of CD4+CD25+ regulatory T cells (Tregs). In addition, the BMSCs can be utilized as delivery vehicles for therapeutic proteins such as neurotrophic factors and anti-inflammatory cytokines into the CNS. In this application, we propose to investigate whether BMSCs expressing transgenic BDNF gene can mediate a dual function, immune suppression and neuroregeneration, and whether transplantation of BMSCs expressing transgenic BDNF can ameliorate acute and chronic EAE. PUBLIC HEALTH RELEVANCE: We propose to investigate whether bone marrow stem cells expressing transgenic BDNF gene can mediate a dual function, immune suppression and neuroregeneration, and whether transplantation of BMSCs expressing transgenic BDNF can ameliorate acute and chronic EAE.